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Editorial: Where Network Solutions Went Wrong

If Network Solutions had good intentions, then it had a very poor implementation.

Yesterday was media-frenzy day in the domain world. Thanks to a thread on DomainState and article at Domain Name News, major media outlets picked up on the story of how Network Solutions is reserving all .com domains searched for by its customers. Domain Name News’ server melted down with traffic, and DomainNameWire ran slow all day.

I didn’t believe what was going on at first, so I called Network Solutions’ head of PR Susan Wade. She was ready for my questions, so clearly there was internal messaging prepared for a potential backlash.

Here’s Network Solutions’ position:

1. It is trying to stop “domain frontrunning”, whereby people steal domain queries. NSI believes this is happening somewhere along the chain between when someone searches for a domain at NetSol.com and the registry. It could be ISPs or it could be people at the registries themselves.

2. To stop this, Network Solutions is placing a four day hold on all domains searched for at its site. The domains can be registered by anyone, but only at Network Solutions.

3. Network Solutions claims this is fair and is not a form of “domain frontrunning” for two reasons: 1) It has no intention to actually keep the name after the 4 day window and 2) It is not monetizing the domains.

Great story. But if this was the company’s goal, someone should be fired over the implementation.

Here’s how Network Solutions messed up:

1. There’s no notice on its website. When people search for domains, they are not warned that a domain will be held. Furthermore, there’s no notice after searching that the name is held. It took a few registrants’ suspicions and investigations to figure out what was going on.

2. Network Solutions has a limited view of what “monetizing” means. The company says it is not monetizing the domains it reserves, but this simply isn’t the case. Apparently the company thinks “monetizing” only means putting targeted pay-per-click ads on a site. But Network Solutions is placing full page billboards on each of these domains, like the one below:

The company is now squatting on hundreds, if not thousands, of trademark domains. Anytime someone searches for a trademark, Network Solutions is registering it and putting up its billboard. Even though the billboard may not be targeted to the trademarked brand, it is using that company’s goodwill. Furthermore, sometimes the billboards are targeted. For example, yesterday I searched for DotsterDomainNames.com and RegisteratGoDaddy.com. Now Network Solutions is advertising its services on these competitors’ names! [Update: In part due to this criticism, Network Solutions has taken down their billboard ads and put up “under construction pages”. Soon, the domains will not resolve at all.]

3. Network Solutions is abusing the registration grace period. The company is dropping domains after 4 days, which allows the company to get a refund for the registration price from the registry VeriSign (NASDAQ: VRSN). The grace period was designed to refund domains that customers didn’t mean to register (e.g. they typed it wrong). Yes, many companies are abusing this grace period, but now Network Solutions has thrown its hat in the ring.

4. It is exposing all of its customers’ queries to the world. The company said it’s trying to avoid letting someone else find out about your potential domain and registering it. But by pointing all reserved domains to dns1.reserveddomainname.com, the company has willingly disclosed searches to everyone. All you need to do is monitor the server. Take a look: here are over 20,000 domain searches at NSI.

5. Network Solutions didn’t think about the ramifications. What if every registrar did this? Then registrars would start reserving all possible domain names to keep competitors, including Network Solutions, from registering them for their customers.

6. Anyone can register the domains at Network Solutions. If the company’s goal was really to protect you from having someone else steal your domain idea, why do they let anyone else register the domain through them?

Here’s what Network Solutions could have done to be fair. It’s somewhat debatable, but it would have been a better implementation than what they have now:

1. Inform customers that, by searching for a domain, the company would put it on hold for a specified period of time.

2. After searching, inform the customer that a hold of 20 minutes was placed on the domain and that, after that period, the information may be taken and used by someone else (with an explanation, of course). Give them the option to “release” the domain.

3. The domain can then be registered only by the person who searched for it.

4. Do not park the domain with an ad for Network Solutions.

5. Use regular Network Solutions name servers to make it more difficult for people to spy on searches. This wouldn’t eliminate the problem, but would certainly help.

In summary, I believe that Network Solutions was trying to solve a problem. In the process, they decided they could twist it to their advantage to line their own pockets. This is an unethical business practice and was poorly implemented.

Comments

Thanks for the Editorial. We have been listening to your comments as well as those on other sites regarding our customer protection measure. Throughout the launch of this effort we have made, and continue to make, improvements to our protection measure. I want to update you on some of the improvements we are implementing in the near term:

1) We have changed the current webpage to which reserved domain names resolve to a general under construction page. Additionally, all new reserved names after tonight will not resolve to any page at all.
2) This week, we will be making enhancements that will address the concerns related to disclosure of zone file and DNS server information of the reserved names. This should address some of the concerns recently raised.
3) Very soon we will remove our customer protection measure from our WHOIS search page, so that no domains searched on this page will be reserved. We will continue to reserve, however, domains searched from our homepage.

I also want to add that we do inform our customers about the protection measure by including messaging them in their Account Manager. We also are looking at other ways to inform our customers about how to protect their domains.

Shashi
Regarding #3. Please have a glaring warning on your page warning of your practice for searches from the page. Maybe your warning could read

“Dear potential customer, please be alarmed, I mean notified that we will operate as a frontrunner once you search from our site. Don’t worry, you can still get the domain from as at 4 times the price other companies charge. Rather than lower our rates, we decided a capture and hold strategy. Thanks for your understanding. Hope you are dumb enough to search from our site”

I stumbled on to your practices early last evening. Glad to see the internet is fired up as much as I am.

…and so the Network Solutions’ disingenuousness continues…calling their new front-running scheme (please; let’s call it what it really is, shall we Netsol) a “customer protection measure”…sheesh!

And here’s what they’re really hoping to accomplish by removing their front-running tactic from the WhoIs look up…they know that the millions of unsophisticated domain searchers are those most likely to pay their top dollar $35 price/domain (as an aside; none of us has the right to tell another company what to charge for their products and services; even as ridiculous as we believe them to be)…while all of us more experienced/ knowledgeable folks who know–or will figure out–that we can just use their WhoIs search page to avoid their draconian domain grab…and stop frying them on the domains boards, blogs, and in the press (which is not going to happen anytime soon).

So you see, they’re hoping to have it both ways…continue feasting on the uninformed willing to cough up $35/name…while allowing all of us (who don’t give them our business anyway) to continue to use their WhoIs in the hope that we’ll all shut up…

#2: This is a step in the right direction, although a lot still needs to be done. Any thought given to shortening the lock up period?

#8: Markus, this probably wasn’t something Network Solutions did. In fact, the “customer protection measure” was created to stop that sort of thing from happening. To be fair to them, what happened to you is exactly what they’re trying to stop. They just went about it the wrong way.

Thanks for a great editorial on this shameful move by NSI. I’m one of the many folks whose desired domain name has been hijacked by NSI.

One thing that others may not realize is that due to the public outcry, Network Solutions has been changing its policies at whim with no notice. For instance, on 1/8, I searched for a domain name on its website and found it to be available. I wasn’t pleased with their prices, so I went elsewhere to register it only to find that it was no longer available, with WHOIS showing it owned by Network Solutions. A couple of hours later, I read on the blogs that domain names that were being held by Network Solutions were suddenly showing as “available” again by other registering companies. I found that was the case with my desired name, so I registered it with one of these companies and got a receipt showing that I registered it. Unfortunately, the registering company is now having trouble actually registering it to me because Network Solutions still has a hold on it. It’s causing chaos for other domain registration companies when a domain is supposedly available … but it’s really not.

I just got an email from Register.com about their program, which seems much more customer friendly. Basically, they let you put a 4 day hold on a domain for free if you’re interested in it. Then only you can register it. Here are the details:

There is absolutely NO warning for potential customers. Unfortunately, I went to NS instead of another reputible registrar and searched for a domain, which was available. When I checked their hosting prices, I decided to a more reasonable hosting agent. Well what do you know. My domain was no longer available. Guess what networksolutionssucks.com is now no longer available. In the meantime, before I found out what was going on, I settled for a different domain and when with a more reasonable hosting package. I had to get it quick, as I need to get this site up and running before the end of January.